Derivatives and Quantitative Strategist

Gaudenz Schneider

Equity Bottom-Up

<ul>
<li>
Context: This Insight follows up on previously highlighted relative value opportunities, using a statistical methodology based on mean-reversion to identify opportunities in paired securities.</li>
<li>
 Highlights: In India, currently three pair trade opportunities persist across two sectors.</li>
<li>
Why read: Statistical analysis offers a unique perspective on relative value. Gain insights into actionable statistical pair trade opportunities and monitor performance of previously highlighted pairs.</li>
</ul>



Context: This Insight follows up on previously highlighted relative value opportunities, using a statistical methodology based on mean-reversion to identify opportunities in paired securities.

 Highlights: In India, currently three pair trade opportunities persist across two sectors.

Why read: Statistical analysis offers a unique perspective on relative value. Gain insights into actionable statistical pair trade opportunities and monitor performance of previously highlighted pairs.


India: Relative Value Opportunities and Pair Trades (29 Sep 2026)

<ul>
<li>
Context: The <a href="https://www.smartkarma.com/entities/aditya-birla-capital-ltd" target="_blank" data-smartkarma-citation="entities:27031:1" rel="noopener">Aditya Birla Capital (ABCAP IN)</a>  vs. <a href="https://www.smartkarma.com/entities/l-t-finance-ltd" target="_blank" data-smartkarma-citation="entities:9661:1" rel="noopener">L&amp;T Finance (LTF IN)</a>  price ratio has deviated more than two standard deviations from its one-year average, presenting a potential relative value opportunity.</li>
<li>
 Highlight: Going long <a href="https://www.smartkarma.com/entities/l-t-finance-ltd" target="_blank" data-smartkarma-citation="entities:9661:1" rel="noopener">L&amp;T Finance (LTF IN)</a> and short <a href="https://www.smartkarma.com/entities/aditya-birla-capital-ltd" target="_blank" data-smartkarma-citation="entities:27031:1" rel="noopener">Aditya Birla Capital (ABCAP IN)</a> targets a 5% return.</li>
<li>
Why Read: Essential for quantitative traders seeking mean-reversion opportunities, with detailed execution framework, risk management protocols, and historical simulation showing the statistical basis for this relative value play.</li>
</ul>



Context: The Aditya Birla Capital (ABCAP IN)  vs. L&amp;T Finance (LTF IN)  price ratio has deviated more than two standard deviations from its one-year average, presenting a potential relative value opportunity.

 Highlight: Going long L&amp;T Finance (LTF IN) and short Aditya Birla Capital (ABCAP IN) targets a 5% return.

Why Read: Essential for quantitative traders seeking mean-reversion opportunities, with detailed execution framework, risk management protocols, and historical simulation showing the statistical basis for this relative value play.


L&T Finance (LTF IN) Vs Aditya Birla (ABCAP IN): IRDAI Proposal Spurs 9% Drop, Stat Arb Opportunity

Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

Gan & Lee Pharmaceuticals / Technical Analysis

<ul>
<li>We remain near-term bullish since our 4/22/25 Compass, and our intermediate-term outlook remains bullish as well (as of our 5/14/25 Compass), with Int’l Compass reports all echoing this sentiment</li>
<li>Short-Term supports to watch on ACWI-US continue to be $132 (testing now), $130, $128, $125-$126, and $123-$123.50. All signs point to the ACWI-US uptrend continuing for the foreseeable future.</li>
<li>Upgrading China to Overweight; Europe Breaking Out; Japan Also Remains Attractive. Buys in Consumer Discretionary (primarily autos/parts), Industrials, Services, Health Care, Materials, Financials, and Real Estate</li>
</ul>


We remain near-term bullish since our 4/22/25 Compass, and our intermediate-term outlook remains bullish as well (as of our 5/14/25 Compass), with Int’l Compass reports all echoing this sentiment
Short-Term supports to watch on ACWI-US continue to be $132 (testing now), $130, $128, $125-$126, and $123-$123.50. All signs point to the ACWI-US uptrend continuing for the foreseeable future.
Upgrading China to Overweight; Europe Breaking Out; Japan Also Remains Attractive. Buys in Consumer Discretionary (primarily autos/parts), Industrials, Services, Health Care, Materials, Financials, and Real Estate


Upgrading China to Overweight; Europe Breaking Out

Oil & Natural Gas Corporation / Technical Analysis

<ul>
<li>MSCI EM (EEM-US) continues to show signs of bottoming as it has held above our $37-$37.50 line-in-the-sand. </li>
<li>Major 1+ year resistance on the EEM-US is at $42, and a breakout would mean the bottom is in (and would be a buy signal).</li>
<li>Favor EM over EAFE due to 2.5-year downtrend reversal in the EAFE vs. EM ratio. Top Overweights: Taiwan, India, Greece; Attractive EM Sectors: Energy, Technology, Consumer Discretionary, Financials</li>
</ul>


MSCI EM (EEM-US) continues to show signs of bottoming as it has held above our $37-$37.50 line-in-the-sand. 
Major 1+ year resistance on the EEM-US is at $42, and a breakout would mean the bottom is in (and would be a buy signal).
Favor EM over EAFE due to 2.5-year downtrend reversal in the EAFE vs. EM ratio. Top Overweights: Taiwan, India, Greece; Attractive EM Sectors: Energy, Technology, Consumer Discretionary, Financials


MSCI Emerging Market Index Testing 1+ Year Resistance; Favor EM over EAFE; Top EM Buys Highlighted

iShares MSCI ACWI ETF / Technical Analysis

<ul>
<li>Global equities are under some pressure after Fitch downgraded the United States' credit rating to AA+ from AAA.</li>
<li>We expect that this is a normal 3%-6% pullback to the 50-day MA or major $93 support level on the MSCI ACWI <a href="https://www.smartkarma.com/entities/ishares-msci-acwi-etf" target="_blank" data-smartkarma-citation="entities:24402:1" rel="noopener">iShares MSCI ACWI ETF (ACWI US)</a> .</li>
<li>$TNX is below 4.1%-4.3% and DXY remains in an 8-month downtrend; as long as this remains true, we'd buy on a pullback to the 50-day MA and/or $93 on ACWI-US</li>
</ul>


Global equities are under some pressure after Fitch downgraded the United States' credit rating to AA+ from AAA.
We expect that this is a normal 3%-6% pullback to the 50-day MA or major $93 support level on the MSCI ACWI iShares MSCI ACWI ETF (ACWI US) .
$TNX is below 4.1%-4.3% and DXY remains in an 8-month downtrend; as long as this remains true, we'd buy on a pullback to the 50-day MA and/or $93 on ACWI-US


Normal Pullback, or Something More?; Watching Resistance on DXY and 10-Yr Treasury Yield; Value Buys

India

Aditya Birla Capital Ltd (ABCL) is a non-banking financial company and the financial services flagship of the Aditya Birla Group. It offers a comprehensive suite of financial solutions, including loans, investments, insurance, and payments. The company is headquartered in Mumbai, Maharashtra, India, and was founded in 2007.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

Aditya Birla Capital (ABCAP IN)

India: Relative Value Opportunities and Pair Trades (29 Sep 2026)

Discover three pair trade opportunities across two sectors using statistical mean-reversion methodology for actionable insights.

Gaudenz Schneider

L&T Finance (LTF IN) Vs Aditya Birla (ABCAP IN): IRDAI Proposal Spurs 9% Drop, Stat Arb Opportunity

5% target return after an IRDAI proposal triggers a sharp dislocation, creating a fresh pair trade opportunity for mean-reversion traders.

Gaudenz Schneider

Upgrading China to Overweight; Europe Breaking Out

Upgrading China to Overweight. Europe Breaking Out. Japan Remains Attractive. All signs point to the $ACWI uptrend continuing for the foreseeable...

Vermilion Research

MSCI Emerging Market Index Testing 1+ Year Resistance; Favor EM over EAFE; Top EM Buys Highlighted

MSCI EM Index $EEM Testing 1+ Year Resistance; Favor EM over EAFE $EFA. Top EM Country Overweights: Taiwan, India, Greece; Attractive EM Sectors:...

Vermilion Research

Normal Pullback, or Something More?; Watching Resistance on DXY and 10-Yr Treasury Yield; Value Buys

Normal Pullback, or Something More for global equities?; Watch Resistance on $DXY and 10-Yr Treasury Yield; Value Buys in Consumer Discretionary...

Vermilion Research

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

India: Relative Value Opportunities and Pair Trades (29 Sep 2026)

​Discover three pair trade opportunities across two sectors using statistical mean-reversion methodology for actionable insights.

Gaudenz Schneider

L&T Finance (LTF IN) Vs Aditya Birla (ABCAP IN): IRDAI Proposal Spurs 9% Drop, Stat Arb Opportunity

5% target return after an IRDAI proposal triggers a sharp dislocation, creating a fresh pair trade opportunity for mean-reversion traders.

Gaudenz Schneider

Upgrading China to Overweight; Europe Breaking Out

Upgrading China to Overweight. Europe Breaking Out. Japan Remains Attractive. All signs point to the $ACWI uptrend continuing for the foreseeable...

Vermilion Research

MSCI Emerging Market Index Testing 1+ Year Resistance; Favor EM over EAFE; Top EM Buys Highlighted

MSCI EM Index $EEM Testing 1+ Year Resistance; Favor EM over EAFE $EFA. Top EM Country Overweights: Taiwan, India, Greece; Attractive EM Sectors:...

Vermilion Research

Normal Pullback, or Something More?; Watching Resistance on DXY and 10-Yr Treasury Yield; Value Buys

Normal Pullback, or Something More for global equities?; Watch Resistance on $DXY and 10-Yr Treasury Yield; Value Buys in Consumer Discretionary...

Vermilion Research

Discover three pair trade opportunities across two sectors using statistical mean-reversion methodology for actionable insights.